The 10-second takeaway
For the quarter ended March 29 (Q1), Tellabs met expectations on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped significantly. Non-GAAP loss per share didn't change. GAAP loss per share dropped.
Gross margins shrank, operating margins contracted, net margins grew.
Tellabs booked revenue of $209.4 million. The 10 analysts polled by S&P Capital IQ hoped for sales of $212.5 million on the same basis. GAAP reported sales were 19% lower than the prior-year quarter's $257.9 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at -$0.04. The eight earnings estimates compiled by S&P Capital IQ predicted -$0.04 per share. Non-GAAP EPS of -$0.04 were the same as the prior-year quarter. GAAP EPS were -$0.16 for Q1 compared to -$0.38 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 34.5%, 260 basis points worse than the prior-year quarter. Operating margin was -12.5%, 50 basis points worse than the prior-year quarter. Net margin was -26.7%, much better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $223.3 million. On the bottom line, the average EPS estimate is -$0.01.
Next year's average estimate for revenue is $906.3 million. The average EPS estimate is $0.00.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 383 members out of 431 rating the stock outperform, and 48 members rating it underperform. Among 90 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 82 give Tellabs a green thumbs-up, and eight give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Tellabs is hold, with an average price target of $2.47.
Internet software and services are being consumed in radically different ways, on increasingly mobile devices. Does Tellabs fit in anymore? Check out the company that Motley Fool analysts expect to lead the pack in "The Next Trillion-dollar Revolution." Click here for instant access to this free report.
- Add Tellabs to My Watchlist.
Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.